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Transition literature has emphasized stabilization and * Reduced spending on government transfers enterprise restructuring. Both cross-country analyses and contributed to a sharp increase in income inequality in country-specific studies have tended to focus on fiscal the CIS. stabilization and its indicators, highlighting the * Fiscal risks increased during the transition. importance of quantitative fiscal adjustment to * Initial conditions allowed Central European and stabilization outcomes. Less attention has been paid to Baltic countries to maintain higher expenditures, the qualitative dimensions of fiscal adjustment in which may have contributed to their faster economic transition.recovery and political support for the reforms. Alam and Sundberg take stock of the extent to whichThe authors argue that the challenge today for fiscal adjustment has occurred during the first decade fiscal policy in these countries is to facilitate the of transition in both qualitative and quantitative transition-particularly in reallocating resources from dimensions. They define quality as the extent to which: large state-owned enterprises to new small and (1) pro-growth expenditure essential for creating future medium-size firms, and providing priority public economic and social assets are maintained; (2) pro-poor services and targeted transfers to assist those expenditure, such as poverty-targeted transfers, necessary adversely affected by transition and reverse the to ensure income for the poor and vulnerable are deterioration in social outcomes. The interplay adequately provided; and (3) fiscal risks, impinging on between fiscal policies and institutional arrangements both expenditure and revenue, are managed through is increasingly important as transition economies transition.embark on their second decade of reforms. In The authors conclude that while the quantitative particular, incentives embedded in the institutional magnitude of the fiscal adjustment was dramatic, the arrangements for fiscal management needs to be quality of this adjustment has compromised the social strengthened so that policies, resources, and outcomes and economic objectives of transition, particularly in the can be better aligned, and the fiscal adjustment is Commonwealth of Independent States (CIS). They draw consistent with qualitative considerations. four main conclusions: * Investments in public services fell in both absolute and relative terms. This paper-a product of the Poverty Reduction and Economic Management Sector Unit, Europe and Central Asia Region-is part of a larger effort in the region to understand economic transition in former centrally planned economies.

South Africa has achieved a lot on its path of socioeconomic transformation since the end of apartheid in 1994. Although many challenges remain to fostering inclusive growth to address the triple challenges of unemployment, poverty, and inequality, some innovative approaches have been used to build more inclusive public institutions. These have helped to expand service delivery, strengthen quality, and improve the lives of millions of South Africans. Although much is known about the motivation and nature of the policies and institutional changes that drove this transformation, very little is known of the manner in which they were executed. With this book, Making It Happen: Selected Case Studies of Institutional Reforms in South Africa, we offer a selection of twelve case studies to illustrate how policies and institutions were developed and implemented to improve specific public services. Based on interviews with senior policy makers, the book captures the how-to of designing and executing these policies in a variety of strategic areas, including increasing budget transparency, developing an intergovernmental fiscal system, strengthening tax administration, enhancing the statistical system, developing a modern performance monitoring and evaluation system, expanding HIV/AIDS treatment, reforming the social transfer system, creating a modern national identity system, developing a system for the management of biodiversity, modernizing the national road network management, developing the framework for renewable energy, and formulating the country's much-lauded constitution. Tracing a twenty-year journey of transformation, this book places particular emphasis on recording the design of these reforms and endeavors to shed some light on the decision-making processes. In particular, it attempts to provide insight on the trade-offs policy makers faced, and the sequencing and complementarities among the various reforms. It finds leadership at different levels, adoption of pragmatic and innovative solutions, and the focus on results as among the key drivers in implementing these changes. This book is primarily intended to enhance knowledge exchange by exporting South Africa's development experience to the world. It is a product of the country's Knowledge Hub, developed in partnership with the World Bank Group, to provide evidence-based solutions for enhancing service delivery. Many of the lessons identified here have applicability for other countries, with adaptation, of xii Foreword Making It Happen •